Senators upset about exchange secrecy

SACRAMENTO (AP) — Five Republican U.S. senators said Friday they have asked the U.S. Department of Health and Human Services to investigate whether California is inappropriately concealing details of contracts for its health insurance exchange.

Their letter was sent in response to a report last month by The Associated Press, which revealed that Covered California appears unique among states in the level of secrecy it is afforded.

When lawmakers created California's exchange under the federal Affordable Care Act, they gave it the authority to conceal contracts for a year and the amounts paid indefinitely. Exchange officials also can keep secret board meeting minutes, employee training materials and records that reveal recommendations, research or strategy.

Signing the letter to agency Secretary Kathleen Sebelius are Sens. Lamar Alexander of Tennessee, Johnny Isakson of Georgia, Richard Burr of North Carolina, Pat Roberts of Kansas and Tim Scott of South Carolina. All are members of the U.S. Senate Committee on Health, Education, Labor and Pensions.

They wrote that California should publicly account for the federal money it receives to build and run the state's health insurance exchange.

"We see no reason why a state that has been awarded nearly $910 million in federal taxpayer dollars should not disclose how that money is being spent once a contract is finalized," they wrote.

Health and Human Services spokeswoman Joanne Peters said in a statement that the agency has received the letter, dated Wednesday, and is reviewing it.

The senators also asked the agency to review whether any other states are concealing details of their insurance exchange contracts, saying President Barack Obama has pledged "that his administration would be the most open and transparent in history."

An AP review of the 16 other states that have opted for state-run marketplaces shows the California agency was given powers that are the most restrictive in what information is required to be made public.

The insurance exchanges established in Massachusetts, Idaho and New Mexico, for example, are specifically covered by open-records laws. Maryland officials have allowed for some types of commercial and financial information to be protected.

Covered California plans to spend nearly $458 million on outside vendors by the end of 2014, covering lawyers, consultants, public relations advisers and other functions. Exchange spokesman Dana Howard has said the agency complies with state law.

The AP report also prompted two state lawmakers to introduce a bill seeking to narrow the exchange's secrecy provisions. SB332 from Sen. Bill Emmerson, R-Redlands, and Sen. Mark DeSaulnier, D-Concord, is scheduled to be heard June 19 in the Senate Health Committee.